>> it is april 19 and this is "trending business." we will be taking you to sydney in the next couple of minutes. timelimbing for the first in five days. up after on the announcing robust results. first quarter production results are in line with estimates.

newcky start for twitters china had. -- head. let us know what you think. follow me on twitter. please use that #. the bank of korea keeping benchmarks -- interest rates on hold. we are looking for whether we are getting a cut in their growth forecast and a cut in their inflation forecast. we are waiting for those details to drop. let's take a look at the trading day. juliette: let's have a look at the korean yuan. up by half of 1%. it was very much expected, that interest rates would be left on

hold at 1.5%. we are looking for clues as to whether there will be that cut. it has been a good day for the korean market. it is continuing to hold on to those gains around half a percent. we have malaysia, singapore coming online. we have a strengthening ring get strengthening malaysian ringgit. the yen is back down against the dollar. some solid support coming back through the region. the asx 200 up 1.5%. a flat pick up coming through in new zealand. the kiwi dollar is at its highest level since june. the iron ore prices also rebounded. rio tinto has come through with

first quarter iron ore production which was bang in line with estimates. these are some of the companies affected by the earthquake in japan. that also is a reflection of that weaker yen. rishaad: thank you. rio tinto announcing what it calls robust first-quarter production numbers. let's get over to sydney. how is it looking? what makes them so confident? paul: they delivered 84 million tons of iron ore in the first quarter. rio tinto pretty much in line with estimates. it is down 4% on the quarter, but up 13% on the year.

iron ore is very important to rio tinto. iron were pushed back above $60 per ton overnight. as for guidance, they will probably have to ramp up production to hit their 2016 figure of 350 million tons because they have exhausted a lot of their stockpiles. looking ahead to 2017, they might be pulling production back a little. that will come as a great relief to a market that has been somewhat oversupplied with iron ore of late. rishaad: thank you for that,

paul allen. looking at these problems as they mount for the malaysian state investment arm on top of international investigations into alleged money-laundering, embezzlement. this is a saga, is it not? shary: ongoing drama for malaysia right now. 1mdb and its shareholder already in default. they fail to make a payment of more than $1 billion in connection with a loan made last year. bondholders waiting for an interest payment. the fund indicated it no longer has an obligation to make the interest payments.

failure for either side to fulfill the debt obligation could result in the first default since its creation back in 2009. repaid all of has its bank borrowing. the market reaction has been swift. the bond prices slumped on monday since the lowest in november. the conflict comes as malaysia plans to sell as much as $5 billion of global bonds. billion of global bonds. the malaysian central bank governor said over the weekend they had want the government as early as 2014 of risk to the --ancial system from one mdb 1mdb. much --e identified as

--stionable rishaad: thank you for that. let's take a look at the earnings season in the u.s. some of the technology companies, subscriber-based have started to slow down. let's kick things off with david. let's talk about netflix. shares are doing -- there we go, down 8%. 92.38.down to about investors are rattled after a much weaker forecast from the company in its international business. 2 million new customers

internationally this quarter. that is about 1.5 million short, lower than the average forecast. the company is dealing with scherzerrofit margins, seeing a bit of -- shares are seeing a bit of pressure. let's talk about ibm, shares are also falling after hours. 19%. sales continued to drop. revenues have fallen 16.75. a little bit from 14% to about 5% based on the latest report. the company change the way it reports its performance across its different businesses. to better reflect its renewed focus on these new businesses. the cloud and software part of the business is growing rapidly,

double digits, but not enough to offset the lagging business. yahoo!, whot on remembers the yellow pages? old school phone book. yp is the digital ad business of the former yellow pages. that is a company that is said it is planning a bid to merge with yahoo!. sources say it is working with goldman sachs over strategic options. one is a tax-free transaction that would see it merge with a of yahoos corent business. updates on yahoos

legal problems. the company's antitrust headaches in europe. news corp. filing a complaint against the legality of google search and news services. the premise argues google keeps users within google's ecosystem of services by displaying enough content to discourage them from going elsewhere and clicking on other websites. several of the eu regulators are preparing complaints. the premise is that the operating system limits the type of apps customers can choose from. those are the two problems at the moment. back in the u.s., its plan to create a searchable library can go ahead.

the supreme court rejecting an appeal from authors with a claim that it would violate the copyright. the project has scant 20 theion, mostly -- scanned million, mostly nonfiction, books. rishaad: china's crowded smartphone market and the brands which could be casualties. interesting stats. it is on bloomberg.com/asia. up next, the latest read on south korea. interest rates kept on hold by the bok. ♪

rishaad: we return to the rate decision we had from the bank of korea, on hold, 1.5%. pretty much in line with the 17 of the 22 economists we have been talking to. knows the price for you here -- no surprise for you here. expect the bank of korea -- every single quarter, they revised down and down again. we think the rate cut is only a matter of time. seems to think it is too early to cut interest rates. he emphasized that. wait for theay right timing. what would be the right timing? we think that would be july.

to maximize the effect of the policy action, right? come withut will fiscal stimulus -- that would not be great. here is the baseline case. we think the government will announce extra budget as early as june. we think the bank of korea will cut interest rates in july. we have a new -- new members who will join tomorrow. they will probably think about the right timing of the rate cut. rishaad: when we look at what is going on, we are expecting today the economic outlook to be lowered. it was 3% before inflation.

looking at this economy, they see it continue in the -- continually weakening. why? korea, the target is 2%. aeir own forecasts suggest negative gap is widening and inflation is far below the target. rishaad: come back to this. household debt is not going to be helped by cutting interest rates. >> of household debt, the growth weight -- the growth rate is uncomfortably high. the government will implement the second round of the regulation on mortgages in may

for the rural area. it was very high in october, 18%. now 16%. still very high. the housing market in korea has to do to taper off -- started to taper off. rates,fed hikes interest that concern is overdone. we have a lot of surplus. -- has more assets than liabilities. why are we concerned about the capital outflow? i don't think so. if these concerns fade away,

there is a good chance for the bok to cut rates. rishaad: with the yen, the biggest competitor to korea, ,trengthening as much as it has surely south korean exporters should be doing better. biggest is the competition. we also think about other currencies. korean exporters do a lot of business, not only in japan. the big point for korea is not just against the japanese yen. rishaad: it is a function than of what is happening when it comes to the global growth story, i suppose. >> global growth is very

important. that china's economy is balancing, they are moving from investment toward more consumption driven economy. the big part of the export to the investment demand in china. that demand is slowing. it will take time for south korea to benefit from increasing consumption in china. rishaad: always a pleasure having you on the show. let's take a look at some of the other stories. the u.s. military sending aid as

rescue research for 10 people missing after the earthquake. over 40 people were killed, 1100 were injured. more than 100,000 forced to leave their homes. the number of victims from the quake in ecuador has risen to at least 413 with thousands injured and displaced. it was the most powerful to fit the country in decades. the falling oil prices is not helping either. ecuador is an opec member. south korea says there are signs that the north is preparing another nuclear test. elaborate,nt did not but all of the military is on alert.

the u.s. says last friday's missile launch ended in failure. owered by over 2400 journalists in over 150 bureaus, you are watching bloomberg news. airbus says it is back on track. we will hear from the company's chief executive right after this. ♪

rishaad: airbus scrambles to overcome engine problems with engine option.

the airbus chief executive says production plans are on track and teething problems will be resolved by the middle part of the year. it was largely planned just to gain enough maturity and to fix the small issues we have faced at the beginning. we are making good progress and toelieve we will be able really ramp up production. >> are you concerned because they might walk away? >> i do not think so. -- we have jointly decided to postpone. -- this issay is

already a great success. mentioned, anyu progress? >> not yet. we are discussing with some potential customers in the region. this potential israel. -- is real. progress on that? >> we know we have the potential. we are studying what we could do

with the aircraft. we have started to talk to some customers because we are not sure there is a market in this segment. we have the capacity to do one. rishaad: we will keep the aviation theme going as we talk to the chief executive of a company looking to cut the flight time from new york to london as much as 3.5 hours. look at a couple of stories. mumbai issued an arrest warrant for the tycoon, india's battle to recover debt. the government suspended his diplomatic passport. the latest attempt to clawback money lent to kingfisher airlines.

next, the popular payment system that could deliver china's biggest valuation in years. we have hong kong and shanghai open. this is "trending business." ♪

rishaad: stocks following wall street higher, crude rebounding to $40 a barrel in new york. that is good for the key we--- the kiwi dollar and the aussie dollar. the yuan has strengthened after korea's central bank adopted a wait and see attitude. economic data has been disappointing this year, the

latest figures showed signs of improvement. expecting revised gdp figures little bit later on. of theital ad business former yellow pages.com is planning an offer for yahoo!. tax-free -- it is the start of the tuesday morning session. we have reserve bank of australia dropping across the bloomberg news wire. juliette: a much better session coming through on the markets today. look at these games on the open here in hong kong and shanghai. a very different picture to what we saw yesterday. flat.mobile is pretty good gains coming through in

shanghai. -- career rate decision korea rate decision on hold from the bank of korea. we are seeing the won strengthen. the nikkei 225 was the worst performer in the region yesterday. it is the best today. hard by there hit earthquake over the weekend and some are recovering their losses. a weaker yen is helping things out. a rebound in commodity prices helping the asx 200, up by 1.3%. the philippines has also opened higher. paul will be running through those numbers. we have seen the aussie dollar, some strength coming through, up to tens of 1%. -- 2/10 of 1%.

rishaad: thank you for that. the bank of australia with minutes from its april meeting. paul allen is in sydney. any surprises in these minutes? paul: no huge surprises. a little clarity, perhaps. it is appropriate for the cash rate to remain accommodative. the labor market is stronger in unlikelydity rebound, to impact mining investment. as for the australian dollar, a higher australian dollar could complicate the rebalancing. that is a little bit more information we had in the statement. the australian dollar has risen by 2% since the statement was

released. on the release of these minutes, not a great deal of change to the currency. rishaad: let's have a look at what is going on as far as fiscal policy. importancelot more to what happens with that budget on may 3. there could be billions of spending cuts in store as well. paul: that is right. the first of the budget leak stories out today suggesting $16 billion in cuts, savings over the coming four years. from the wayme multinationals are taxed in australia. it would reduce the amount of debt. the source comes from a news reporter who claims to have seen a television advertisement

script due to be released once the budget is out on may 3. the government denies the contents of this leak. senate rejected the bill we were discussing yesterday. it gives the prime minister the trigger he needs to call an early election. that is likely to happen on may 5. in the meantime, we have a lot of shadowboxing. campaignion has -- the has gone underway. check on some of the other stories we are following. morgan stanley becoming the latest bank to post results ahead of estimates. eight cents more than analysts were expecting. morgan stanley has been cutting costs.

just marginally down. hsbc is considering a share buyback. the chief executive says once the banks capital requests have been met, it would consider buying back shares trading below book value. he will be stepping down next year. 60% soares have fallen far -- 16% so far this year. credit suisse says it will stop -- credit suisse will no longer let analysts interview companies to gather information. credit suisse may be penalized by the watchdog. if you are invested in chinese bonds and do not like bad news,

to look away. things are going wrong in the country's corporate bond market and it is happening quickly. --id: the just of the story, the just of the story -- gist of the story, if things stay the way they are, we will see yields come up and a lot of this premium built into the credit corporate dohinese not exactly needed. this shows you trendd s and changes in credit ratings. what this shows you is so far s&p, 57r, we have seen

songrades from s&p in china far this year and we are barely into the second quarter. that is more than the entire 2015, if i am not mistaken. the number decreases as you go back in time. there is the function of more coverage. seeinge at which we are these downgrades, something you cannot ignore. you can look at spreads, the actual yield. what i have is the seven-year, this was a nine-year low back at the start. we have climbed quite a bit and the steep climb you see recently -- this part right there, eight times.the nine that is your ticker symbol, the

seven-year top rated china corporate debt. you can do one year or you can do 20, whatever floats your boat. a lot of this comes down to the slow down. topline growth under pressure and i have one very simple chart. they come out with every month you have producer prices. i put this together with the change in industrial profits and these two track each other. you have topline growth under pressure and yields on the way up and you have a lot of these chinese corporate shelving their plans to raise money in the bond markets. very good story. you, david.nk

sources telling us alibaba's finance is planning a public offering in the shanghai. they could start this ipo process as soon as the share. thisuld be -- as soon as year. it could be china's biggest valuation since 2010. what does it mean for alibaba? agreement with alibaba prior to the ipo for the company has the right to buy one third of the financial stake. an option would be to receive one one-off payment of the valuation. based on the current valuation, they are doing another round of fundraising, that is about $60 billion.

now, as of now, alibaba is receiving pretax earnings payments every year and so a lot of the valuation from that deal has already been factored into the share price. what would be the significance of the financial going public? >> it is expected they would ipo in china. a lot of those stakeholders are -- what was expected was there -- a lot ofrategic them had not been making profits. -- people were asking where they were going to go. they have already satisfied the

common listing regulations, chinese companies need to be at least three years profitable making accumulative profit of 30 million yuan. foraad: what does this mean a potential market cap? >> there is no other equivalent company with this kind of scale and influence in the internet sector in china. a lot of the users are potential retail investors. that could give them a pretty decent premium. rishaad: thank you very much. the sky is the limit. look at this bright idea, next. ♪

we are having a look at

what is going on in brazil with the embattled president saying she will continue to fight against the move to impeach her. addressing the nation today after the lower half of congress voted in favor of her dismissal. the senate may vote within weeks to order an impeachment trial. show the anticorruption campaign led to 72,000 investigations last year. -- xi jinping said he would target both tigers and flies.

a senior investigator says at least 20 foreigners were of thed in the theft country's reserves. their names and nationalities are expected to be released later. up in the ended philippines, most of it gambled in casinos. euros around the world -- bureaus around the world with 2400 journalists. we will take flight with our next guest. he is the founder of the technology who wants to fly cheaper and faster than concorde. denver is ourm

next guest. >> we are bringing faster travel back, but at a price point a whole lot of people can afford to fly. the great thing about this, it is not science fiction. all of the technology exists today. we are moving along quickly, flying a prototype next year. rishaad: tell us a little bit about the plane itself. what sort of engines what they be? the cost for this and economic projections? blake: the great thing about the airplane, the key technology is on the airplane. engine, for example, the adaptation of engines growing on it -- flying on a commercial

aircraft. it would be like flying first class. it will get you over the long-distance in the same time as a domestic flight. rishaad: it strikes me that it is only marginally faster than concorde. tell me, surely we should have moved on from that now. >> concorde was designed 50 years ago. the problem was not the speed. it is the economics. it is hard to find 100 people who want to pay $20,000 to get somewhere. we have taken all of the progress and turned that into supersonic travel at a much better price point. foresee muchou

competition? putting thatirbus in the works. a prototype in three years or something like that. nasa is looking at all of this as well. blake: our vision is unique. we are aiming for faster travel that anybody can afford to fly. some projects are science fiction-y and some are aimed at private jets. i wish all of those the best, but we want anybody in the public to be able to buy a ticket. rishaad: i'm an aviation enthusiast. these stories pop up but never seemed to materialize. >> i am the key -- the key technology for this airplane exists. this is not science fiction.

we are taking technology that exists today and combining it with an aircraft with revolutionary capability. we will be flying our first prototype at the end of next year. rishaad: what do you make of other technology out there? breathingistic air rocket engine developed in the u k? rishaad: lots of interesting -- blake: lots of adjusting technology on the horizon. all of those are a breakthrough way from being practical. what is exciting about what we are doing, it does not need a new engine. does not need new material. you can come to market a lot sooner. rishaad: how much money do you need to develop this plane to fruition? airplaneilding a new is capital-intensive.

the exciting thing is the market opportunity is the norm is. tens of millions of people fly international business class today. that is where the highest margins are. the business case is quite strong. rishaad: one of the big problems would be they cannot fly coast to coast in the u.s. because of the sound wave. how do you eliminate that so you can fly domestically? can you come up with a solution? blake: the boom aircraft is quieter than concorde. the challenge with supersonic flight over land is much more about politics than technology. we have a law that prohibits flight over land regardless of how quiet the airplane is. that needs to be overturned.

i think there will be a lot of political pressure to get the rules fixed. rishaad: who is going to buy the plane? airlines will buy the plane. already, richard branson has stepped up. months fromuple of offering the plane on the market. i think in the future, all travel will be supersonic. rishaad: a prototype next year. when with the production start -- winwood the production start -- winwood the production start? blake: the prototype flies at the end of next year. after that, and involved safety testing process and regulatory approval process. these things are not as quick as you would like them to be. we will announce the detailed

schedule for commercial flight after be fly the prototype next year. rishaad: thank you so much for joining us. hoping to build this supersonic plane flying between london and about 3.5 hours or less. ♪

rishaad: we have some breaking news. the sovereign fund at the moment, looking to seek control of this $8 billion yum. it is the company which has pizza hut and talk about under

its amber alert. -- under its umbrella. that is what we have at the moment. kfc and pizza hut going under the hammer, at least the chinese part of the portfolio. bidders new top executive -- twitter's new top executive for china. as well asground some of her initial tweets. she used to work with the people's liberation army in china. already some concerns about her appointment. you see her introducing herself and welcoming this appointment. on top of those concerns, after she created her twitter account,

she was looking forward to cctv andith state runs the reaction has been swift on social media. one twitter user saying this is a wrong decision. saying --rson facebook, another saying -- rishaad: isn't this largely irrelevant? twitter is banned in china. what is she going to be doing? >> chinese citizens do not have access to twitter. the fact is many official state media companies have their own accounts so twitter is saying -- to get the analytics as a viable platform. rishaad: lots of news being made

about social media on social media. coming up next, the market roundup. ♪

charlie: every presidential candidate was in new york this week and the democrats faced off for a fiery final debate in the brooklyn navy yard. all of this comes days before the crucial tuesday primaries. for more, we turn to major garrett, he has been covering the republican primaries. i am pleased to have him here and we will talk about where we are. new york is crucial? >> new york is important. it will be a place for donald trump to reset. he will win new york handily,